B-W Acceptance Corp. v. Alexander

• Citation: 494 S.W.2d 75
• Decision Date: 11 April 1973
• Docket Number: No. 57729,B-W,57729
• Parties: ACCEPTANCE CORPORATION, Plaintiff-Appellant, v. Sarah ALEXANDER, Defendant-Respondent.
• Court: Missouri Supreme Court

Page 75

494 S.W.2d 75

B-W ACCEPTANCE CORPORATION, Plaintiff-Appellant, v. Sarah ALEXANDER, Defendant-Respondent.

No. 57729.

Supreme Court of Missouri, En Banc.

April 11, 1973.

Rehearing Denied May 14, 1973.

Dennis G. Muller, Muller & Muller, Kansas City, for plaintiff-appellant.

Baker, Brandom, Saeger & McElligott, William S. Brandom, Kansas City, for respondent.

BARDGETT, Judge.

The issue in this case is whether a plaintiff-mortgagee in a magistrate court replevin action who obtains prejudgment possession of certain chattels pursuant to §§ 533.240 to 533.450, RSMo 1969, V.A.M.S., (Replevin in Magistrate Court) by filing a statement, affidavit and proper bond has the right to sell the repossessed chattels prior to judgment under the provisions of the chattel mortgage.

This appeal was transferred from the Missouri Court of Appeals, Kansas City District, after opinion, on motion of appellant pursuant to Mo.Const. Art. V, § 10, V.A.M.S., as amended; Rule 83.03, V.A.M.R. The court of appeals held that a plaintiff in replevin does not have the right to sell the chattels pending the replevin action trial. The court adopts portions of the opinion of the late Judge Fred L. Howard of the Missouri Court of Appeals, Kansas City District, without the use of quotations.

This suit in replevin was commenced in magistrate court by appellant as the assignee of an installment purchase contract and a chattel mortgage securing the payment thereof. Respondent purchased household goods in the total amount of $1,060.70. A down payment of $50 was made and time service charges in the amount of $403.02 were added, making a gross price of $1,413.72, payable in 35 monthly installments of $39.50 and the 36th installment for the balance in the amount of $31.22. This contract provided for interest from maturity only. Respondent defaulted on the last four installments payable on the last day of the months of September, October, November and December, 1962. The total default amounts to $149.72, which was all overdue on January 1, 1963. On March 13, 1963, respondent paid $39.50, being the amount of one monthly payment. This reduced the amount owing and in default to $110.22, exclusive of interest accruing since maturity. The day after this payment, March 14, 1963, this suit was filed in magistrate court. The statement and affidavit in replevin alleged that the value of the goods was $325 and demanded damages in the amount of $32.50 for the taking and detention of the property and for injury thereto. It alleged an unpaid balance in the amount of $149.72 (this was the amount in default prior to the $39.50 payment made March 13). Appellant made the appropriate bond and the replevin writ was issued on March 14 and was executed and the property delivered to appellant on March 15. The writ was returnable April 3, 1963. On March 16, the day after the execution of the writ, appellant sold the property 'for the net proceeds of $130.00' at a private sale to 'Gabriel Auction, Kansas City, Missouri.'

On the day prior to the return date of the writ, respondent tendered into the magistrate court payment in the amount of $149.72 as the balance due on the debt, and $41.50 for costs, interest and reasonable expenses. After various continuances, the magistrate court entered judgment for the defendant for possession and for the plaintiff for $110.23, plus costs, that being the amount of the debt in default at the time of the judgment. Appellant appealed to the circuit court. The amended transcript from the magistrate court contains an undated entry appearing immediately after the entry of March 14, 1963, which reads: 'Received of John Cochran, attorney, $191.22.' The last entry in this transcript under date of July 31, 1963, is: 'Amended transcript and check for $191.22 sent to Circuit Court.'

Trial was had to the circuit court sitting without a jury. This consisted of an agreed statement of facts dictated into the record by the attorneys for the respective parties. The court took the case under advisement and later entered its judgment as follows:

'IT IS THEREFORE ORDERED, ADJUDGED AND DECREED that defendant have judgment against plaintiff and Travelers Indemnity Company, the surety in the Replevin Bond filed by plaintiff herein; that plaintiff return said property taken to defendant, or in case defendant so elects, that defendant have and recover of plaintiff and said Travelers Indemnity Company, the said surety, the value of said property so assessed, the sum of $325.00 and have execution therefor, together with defendant's costs and charges in this behalf expended, and that defendant have execution therefor against plaintiff and said surety.'

The court also filed a memorandum of findings of fact and conclusions of law, wherein the trial court concluded that it was not necessary to determine whether or not appellant had a right to sell the property prior to the return date of the writ. The court ruled that the acceptance of the payment on March 13, 1963, amounted to a waiver of dafault and that, therefore, the appellant was not entitled to judgment in replevin because the default had been waived and it was not entitled to possession under the provisions of the mortgage at the time suit was filed. The trial court cites as authority for this ruling the case of Lange v. Midwest Motor Securities Co., 231 S.W. 272 (Mo.App.1921). That case is in fact authority only for the proposition that the acceptance of one payment merely waives the default as to that particular payment and does not waive the default as to other unpaid payments. Thus, under the authority of this case, there was no waiver of the default in the payments due on the last day of the months of October, November and December, in the total amount of $110.22.

The trial court also concluded that the tender by respondent of the full amount due prior to the return date of the writ constituted a complete compliance by respondent with her obligation under the chattel mortgage and that respondent was therefore entitled to judgment of possession. The court further ruled that since the default had been waived the appellant could not invoke the acceleration clause in the mortgage and consequently was not entitled to a money judgment. This last conclusion misconceives the facts because appellant had not invoked the acceleration clause and the $110.22 balance was in default absolutely and without aid of the acceleration clause.

Plaintiff proceeded in this magistrate court replevin action pursuant to § 533.240 et seq., RSMo 1969, V.A.M.S. Under § 533.260 the action can be maintained without obtaining possession of the chattels prior to judgment. Where a plaintiff seeks to obtain prejudgment possession of property in a magistrate replevin action, he must proceed in accordance with § 533.260, subd. 1(6), which provides:

'(6) If the plaintiff claim the possession of the property before judgment, he shall also state that he will be in danger of losing his said property, unless it be taken out of the possession of the defendant.' (emphasis ours)

Other provisions of chapter 533 permit the defendant, in a magistrate court replevin action, to retain possession pending judgment upon posting an appropriate bond.

The plaintiff's right to obtain possession prior to judgment is premised upon plaintiff's claim that the property will be lost unless plaintiff is put in possession of it.

The provision of § 533.270, which pertains to the undertaking by plaintiff when prejudgment possession is sought, provides in part that, 'if the property be delivered to him (plaintiff), he will return it to the defendant, if return thereof be adjudged, . . .' and the like provision of the bond itself is set forth in § 533.280. Sec. 533.310 pertains to the execution of the writ of replevin and the defendant's right to retain possession upon the giving of bond and provides in part, 'If the defendant require it, the officer shall hold the property forty-eight hours to enable him to furnish said bond, and if the same be not furnished in that time the officer shall deliver the property to the plaintiff, who shall have the right to retain the same to abide the event of the suit.'

It is appellant's basic contention that since respondent was in default at the time the suit was filed and prejudgment possession was obtained the court should have entered judgment for possession in favor of appellant. This contention is premised on the concept that the replevin action adjudicates the right to possession as of the date the suit was filed and that there is nothing that can take place between the filing of the suit and judgment that can reinvest the defendant with the right to possession.

Appellant, as holder of a mortgage in default, has only a special interest in the property while the respondent is the general owner thereof. See Baldridge v. Dawson, 39 Mo.App. 527 (1890), and Brandtjen & Kluge, Inc. v. Hunter, 235 Mo.App. 909, 145 S.W.2d 1009 (1940). Under its mortgage, appellant is entitled to the money owing to it plus interest thereon and costs of suit. This special interest was recognized by appellant in the 'Statement and Affidavit' in replevin filed in this case. In that statement, appellant asserted that it was entitled to possession of the chattels then held by respondent 'under purchase money chattel mortgage executed by Sarah Alexander and now held by plaintiff of the value of Three Hundred Twenty Five and 00/100 DOLLARS, or until the balance of $149.72, interest and expenses of replevin suit are paid, . . .' (emphasis supplied.)

Where, as here, the respondent is the general owner of the chattels and the appellant has a special interest, the respondent has the right to redeem the property prior to foreclosure. This is demonstrated by the provision of § 443.290 which provides that a sale under a power of sale contained in the mortgage or security agreement forever forecloses all right and equity of redemption in the...